The Minister of Labour has determined that from 1 April 2025, the earnings threshold under the Basic Conditions of Employment Act, 1997 increased from R254 371.67 per annum (R21 197.63) to R261 748.45 per annum (R21 812.37 per month).
“Earnings” is defined in the BCEA as the regular annual remuneration before deductions i.e. income tax, pension, medical aid and similar payments but excluding similar payments made by the employer in respect of the employee. Subsistence and transport allowances received, achievement awards and payments for overtime worked are not regarded as “earnings” for the purpose of the earnings threshold.
The earnings threshold affects the application of a number of provisions of the BCEA. Employers who engage employees at a rate below the threshold must comply with the following provisions:
• Section 9 – hours of work;
• Section 10 – overtime;
• Section 11 – compressed working week;
• Section 12 – averaging of hours;
• Section 14 – meal intervals;
• Section 15 – daily and weekly rest periods;
• Section 16 – pay for work on Sundays;
• Section 17(2) – night work; and
• Section 18(3) – public holidays on which the employee would not ordinarily work
The change to the BCEA earnings threshold affects other aspects of employment and labour legislation, including:
1. The presumption of employment under sections 198A of the Labour Relations Act, 1995 and section 83A of the BCEA; and
2. The additional protections afforded to employees engaged on fixed-term contracts, through temporary employment services, or on a part-time basis in terms of sections 198A, 198B and 198C of the LRA.
It is important for employers to identify those employees earning below and above the earnings threshold, because those who earn below the threshold are afforded more extensive protection in terms of labour legislation and qualify for certain minimum payments such as overtime pay and pay for work on Sundays and public holidays.
Should employees earning below the threshold be refused or denied the above protections or be paid below the national minimum wage, they may refer a dispute to the CCMA in terms of section 73A of the BCEA. Non-compliance with the BCEA may also attract a fine.
Employers are encouraged to monitor these changes to the earnings threshold (usually published in February each year).
Click here to learn more: Earnings threshold